India’s top carrier Bharti Airtel, also a member of GSMA has recently slammed the regulator for coming out with such exorbitant pricing.Muntazir Abbas | ETTelecom | Updated: February 05, 2016, 14:05 IST

NEW DELHI: World's top GSM lobby group GSM Association or GSMA Tuesday rejected Indian telecom regulator Trai’s price recommendation for the pan-Indian 700MHz spectrum, saying that it could lessen the willingness of potential bidders to buy airwaves and consequently telcos would not left with money to spend on networks.

Teleom Regulatory Authority of India (Trai) last week suggested a base price of Rs 11,485 crore per Mhz that drew sharp criticism from telecom service operators who said that the price was too high.

“High reserve prices and an unrealistic predetermination of spectrum value could also reduce the willingness of potential bidders to buy the spectrum. The more mobile operators have to pay for a spectrum licence, the less capital is available to roll out new mobile networks,” John Giusti, Chief Regulatory Officer, GSMA said.

India’s top carrier Bharti Airtel, also a member of GSMA has recently slammed the regulator for coming out with such exorbitant pricing.

It (700MHz band) is very expensive and totally unaffordable for us, especially at a time when the ecosystem in terms of compatible devices and chipsets is at a very nascent stage," Gopal Vittal, Bharti Airtel's Managing Director & CEO for India & South Asia, commented.

“The GSMA is very concerned by Trai’s pan-Indian 700MHz spectrum price recommendation. India has one of the lowest average revenues per user (ARPU) across the world (US$2.45 at the end of 2015), the group said in a statement.

Combined with so far limited revenue contribution from data services, competitive pressure on operators’ revenues and high capital expenditure to upgrade networks, GSMA said it makes more challenging for operators to recover from high spectrum prices.

The UK-based group citing Australia market said that unrealistically high reserve price resulted in a valuable portion of the 700MHz spectrum left unsold and unused in the country which neither benefitted the economy nor society.

GSMA in a response to Trai’s consultation paper commented that the government should make available the entire spectrum band (in line with APT band plan) in the auction, priced to achieve ‘maximum benefits for the economy and society’ as a whole, in an open and fair award process.

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